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Richmond minorities boosted

By Chris Hutching

Friday 6th June 2003

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The effect of a Takeovers Panel exemption to shareholders of listed Richmond meat company will reduce the influence of southern co-operative PPCS, depending on the final outcome of the five-year takeover battle, which hinges on an Appeal Court hearing next month.

The Takeovers Panel ruling was sought to clarify the effect of recent High Court orders forfeiting and suspending certain voting rights held by PPCS (a penalty for various breaches of the Securities Act).

Other Richmond shareholders would then control an increased percentage of voting rights in the company, putting some of them in breach of the Takeovers Code, depending on their shareholding at the time the court orders come into force.

The exemption allows Richmond shareholders who hold voting rights immediately before the court orders take effect to retain and exercise any increased voting rights they acquire when the Court orders take effect.

Normal rules would apply to any subsequent transactions.

The court ordered that PPCS forfeit 6.8 million and lose voting rights on 14.6 million shares.

This means after the forfeitures PPCS will have 6.8 million shares or 35% of Richmond while North Meats will have 4.28 million or 22%, director Rod Pearce will have 1.5 million shares or 7.7%, Nessock Custodians 1.5 million or 5%, NZ Central Securities Depository one million shares or 5%, with the balance held in smaller parcels.

If the Court of Appeal amends the orders (other than by extending the time at which those orders will take effect) or make new orders, the exemption will not apply and the panel will reconsider the situation.

The exemption would not apply to any shares that PPCS sells to an unrelated third party.

The Richmond share price has held steady at the PPCS bid price of $3.11.

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